Made of ivory satin and chantilly lace, the gown's bodice and skirt are adorned with Nottingham ribbon-lace roses, a handcrafted import from England that fetches $125 a yard.

"These are the kind of dolls you collect and display," Rothwell says.

Doll fever has infected the globe, says Ron Rothwell, Margaret's husband and business partner. "It's the number one collecting hobby in the world," he says. "Number two in the States - right behind stamp collecting."

The passion has turned into a hot business for the Rothwells. What started at home as a few dolly dresses for their daughters' playthings has grown into a full-fledged family enterprise that employs the couple's three grown children and nearly 20 others. Now there's an extensive line of elegantly dressed, limited-edition Lady Anne dolls, sold-out shows on QVC and almost a million dollars in sales every year.

One Lady Anne even went to Hollywood, starring as young Queen Isabella's doll in the hit movie "Amistad."

The creative talent resides in Margaret Anne Rothwell, a dress designer and seamstress whose voice still holds traces of her Irish homeland. Opulent dresses and flawless, porcelain faces occupy her sleep at night. Her hands are what sculpt the clay into models for the dolls' faces, her vision that transforms fabric into gowns worthy of Cinderella's big night.

Not every idea is a winner, of course. There was that thing with Nancy Reagan.

Nancy surfaced during Margaret Anne's "famous people" period - a phase that started when Lady Di married Prince Charles.

"I decided to make dolls of Diana and Charles," Margaret Anne says. Both were in full wedding regalia.

Diana was an "incredible" success, Margaret Anne says. "We made 2,000. They were gone in no time."

Charles sold pretty well, too -as long as he was paired with Diana.

"People wanted to display them as a couple," Ron says. "When they divorced, I told our customers to move them into separate rooms."

More royal replicas followed - a nod to Ron's native England. There was Queen Elizabeth, Prince Phillip, William and Harry and, of course, Fergie in her wedding gown. Then came the Presidents' Wives series. Historical first ladies, such as Martha Washington, Mary Lincoln and Dolly Madison were well-received.

But a series on their modern-day counterparts fizzled with the very first doll - a replica of Nancy Reagan, whose husband was in office at the time.

"Nancy, well, she just wasn't a good seller," Margaret Anne says. "I can't recall if we intended to make 500 or a thousand of her, but we stopped somewhere between 150 and 200."

She blames it on Nancy's dress. A stickler for authenticity, Margaret Anne had garbed the doll Nancy-style.

"I chose red because it was her favorite color, but everything she wore was real straight, A-line and plain. Our customers just didn't like it."

It seems the clothes really do make the doll.

THE CREATIONS

Heads line one set of shelves. Without eyeballs, lashes, hair or painted-on features, the pale procession would make a fine prop for a horror movie, especially with the occasional leg, arm, and torso scattered in between.

"I guess it is kind of odd in here," says Ron, looking around the work room as if he were seeing it for the first time. "You get so used to it, you just don't notice anymore."

It's the porcelain room, and this is where Margaret Anne's ideas get their first breath of life. Plaster molds are made from her clay sculptures, and the porcelain is cast from there. A few faces are summoned from deep in the past. Antique dolls are coveted, and the Rothwells buy old molds where they can. Occasionally, a mold is made from someone else's sculpture.

"We had another artist do Lady Di," Margaret Anne confesses.

Pieces fresh from the mold are called "greenware." They're shaped like the final product, but are chalky, colorless and very fragile. Fine knives and tools erase mold lines, smooth rough spots, cut eye sockets and a large hole in the top of the head - the entry point for the eyeballs yet to come. Visitors can watch the process through two tall windows.

Next comes the firing, in a kiln heated to 2,800 degrees.

"What comes out is like china," Ron says.

The heat turns the whitish-colored pieces to a flesh tone. That's when the Rothwells' son, David, goes to work with his paint brushes.

On goes the eye liner, a few lashes, pink cheeks and rosy lips. Up to two additional firings take place between paintings. Each layer has to be cooked into the porcelain.

Then it's eyeballs and hair lashes, ordered in all sizes and colors from Taiwan and Korea. The head is then matched with a body - either porcelain or a blend of latex and natural clays. Strong elastic bands join the two. Porcelain legs and arms come next.

While all this is happening downstairs, sewing machines whir upstairs. In a room stuffed with bolts of fancy materials and exotic laces and trims, seamstresses crank out tiny costumes designed by Margaret Anne. After the clothes comes a miniature wig - styled and colored just so.

"This is an old art we're reviving here," Ron says. "Not many dolls are made this way anymore. We're one of the few porcelain factories left in the U.S."

"We're making tomorrow's antiques today," Margaret Anne says.

THE BEGINNING

"If you'd told me 20 years ago I'd be in the doll business, I'd have thought you were crazy," laughs Ron, a former engineer who spent 25 years with Allied Chemical. "But business is business, and running this place is like running any other. It doesn't really matter what you're producing."

He gives most of the credit for success to his wife. "She's the one who did it," he says. "It was all her talent."

Margaret Anne says everything happened so fast. Her grandmother and mother, both skilled seamstresses, taught her sewing. And she had studied dress design as a young woman in Belfast.

Making doll dresses for her daughters was something she did just for fun, but soon friends began to notice the clothes. They wanted some for their kids.

It was Ron who suggested his wife start a business. They were living near Petersburg, and his idea led to a small stall in a nearby crafters mall. There, Margaret Anne displayed her outfits on vinyl dolls.

"One day, a lady in the mall suggested I show my stuff to Busch Gardens," Margaret Anne says. "They took the 10 I showed them and ordered six dozen more."

Inspired by the Busch order, Margaret Anne sent samples to Disney. Their buyer wanted six dozen, as well.

"Suddenly, I had a real business," she says. "We had to start hiring people right away."

Eventually, she decided her clothes were too elaborate for the cheap, vinyl dolls who wore them. So she and Ron bought kilns and learned the art of porcelain.

Their handcrafted dolls were an instant hit. Wholesale orders were pouring in. In 1981, they moved to Williamsburg and opened a retail shop. The collectors haven't stopped knocking since.

"We've probably got 5,000 people on our mailing list," Ron says.

QVC came calling about seven years ago, and now Margaret Anne goes on the air about twice a year. It takes three months of work to produce the 1,000 dolls needed for a one-hour show. Most shows are a sellout.

But while QVC is exciting, the Rothwells got their biggest thrill when their "Colonial Joy" doll made it to the silver screen. One of their brochures had circulated around Hollywood, where it was picked up by a member of Steven Spielberg's production crew.

"They called and asked if they could use her in their movie," Margaret Anne says. "When I saw her on the screen, I was so excited. It was quite an honor, especially with a movie the stature of `Amistad.' "

Such exposure fuels the popularity of Lady Anne dolls and drives up their price on the resale market. So does tragedy. Their Diana doll's value has skyrocketed since the princess's death. Originally priced at $225, Diana was selling on the secondary market for $600 before the car crash.

"I heard someone was just offered $5,000 for one," Ron says. "I also heard they turned it down."

THE WILLIAMSBURG DOLL FACTORY

7441 Richmond Road in Norge, just north of Williamsburg

* Business: Making handcrafted, porcelain Lady Anne dolls.

- Retail shop sells 25 other brands of dolls as well, along with doll accessories such as dresses and wigs.

* Size:

- 2,500 square feet of manufacturing and office space.

- 2,000 square feet of retail space.

* Sales: Just under $1 million annually.

* Price of dolls: $200 to $1,500

* Employees: 21 to 22 at peak production times, 14 to 15 during non-peak times.